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N.J. panel backs plan to compensate local governments for costs of stalled transportation work

The legislation would allow local New Jersey governments to use their own funds to complete projects already underway without fear the state will withhold aid when a transportation trust fund agreement eventually ends the shutdown of transportation projects.(Steve Collender/Bigstock)

A measure advanced by a New Jersey Assembly committee would compensate towns and counties for any costs incurred since Gov. Chris Christie ordered the shutdown of transportation projects throughout the state.

The legislation also would allow local governments to use their own funds to complete projects already underway without fear the state will withhold aid when a transportation trust fund agreement eventually ends the shutdown.

Local governments aren’t to blame for the lack of a Trust Fund plan, but they could be on the hook for cost overruns, said Assemblywoman Elizabeth Muoio.

“The governor and the state must take responsibility for these costs and not foist the financial responsibility for this standstill, this self-created emergency, on the backs of our local government and property taxpayers,” said Muoio, D-Mercer.

Assemblyman Greg McGuckin said he’s skeptical contractors will sue local governments for damages because of the shutdown that is now in its third month.

“I’m not sure that we should be authorizing a reimbursement for something that may never happen and, quite frankly, I don’t believe legally will happen,” said McGuckin, R-Ocean.

John Donnadio, executive director of the New Jersey Association of Counties, said no claims have been filed, but some are expected.

“There are county administrators that I have spoken with that have said they know these claims are coming. It could be a week,” he said. “It could be two weeks.”

Project delays could increase costs by as much as 25 percent, Donnadio said.

Assemblyman Scott Rumana, who voted against the bill, said it would be better to allow the projects to proceed and guarantee the state will provide the money for them.

“They could move forward immediately, put people back to get work, get the projects moving, limit any further damage that would be resulting from the delay, and guarantee that the money was going to be there,” said Rumana, R-Passaic. “That’s a better position, I believe.”